RUN OFF THE ROAD

Chicago's Taxi Medallion

In June 2014,the City of Chicago enacted a

two-tier regulatory system that opened the taximarket to tens of thousands of for-hirevehicles. Now, three years later,the income ofsmall taxi operators has been decimated.Unable to keep up withloan paymentsfor theirtaxi medallions coupled with high operatingcosts imposed by the city, hundreds oftaxiowner/operatorsare facing foreclosureontheir medallions. Thousands moreforeclosures are likely unless the city takessubstantial action to reduce the financialburden on small taxi owners.Of the 6,999 taxi medallions in Chicago, 39% areowned not by cab companies, but by small familybusinesses - operators who have just one to fourtaxis.

For these families, their medallion is their small

business, their livelihood, and their retirementsavings.

4,291 medallions 2,708 medallions

Owned by large companies Owned by small businesseswith 5 or more medallions with 4 or fewer medallions

https://www.washingtonpost.com/news/wonk/wp/2014/06/20/taxi-medallions-have-been-the-best-investment-in-america-for- years-now-uber-may-be-changing-thatUnder extreme financial pressures, more and more taxi operators are unableto make their medallion loan payments. As a result, the number of loandefaults, foreclosure notices and surrendered licenses is skyrocketing.

For the first time, lenders are beginning to file foreclosure lawsuits in court.As of May 22nd, 2017, 774 medallions have been surrendered to the city atsome point, with another 579 receiving foreclosure notices. 107 lawsuits havebeen filed since October 2016 with more being filed every day.

Surrendered Foreclosure Notice Foreclosure Lawsuit

Medallions surrendered Medallions in foreclosure Lender has filed suit in courthave been given back to the status have received a to foreclose, repossess thecity because the owner notice of intent to foreclose medallion and seek acannot afford city-imposed from the lender because deficiency judgment for thetaxes and license fees and because the owner has outstanding loan balance. are often soon moved to missed a payment. foreclosure.

Source: City of Chicago Data Portal Public Passenger Vehicle Licenses

Since the city opened the market to an unlimited number of"rideshare" or Transportation Network Provider vehicles, thesupply of for-hire vehicles has exploded.

230,000

227,033 172,500

115,000

57,500

6,999 0 Registered Taxi Transportation Medallions Network Provider Vehicles (Numbers as of April 2017) Source: City of Chicago Department of Business Affairs and Consumer protections information response 4/28/17The oversupply of vehicles has resulted in a drastic declinein the number of taxi trips and fare revenue.

39% Decrease

52% Decrease

Data analysis by James Bradach, Nonprofit Data and Applications, https://jamesbradach.com

Source: City of Chicago Data Portal, Taxi trip dataWhile taxi revenue has plummeted, the high operatingexpenses have remained the same. As a result, the averagenet income per medallion is negative.

AVERAGE OPERATING EXPENSES

FOR AN OWNER/OPERATOR

Medallion Loan Payment Auto Loan Payment City Expenses

Ground transportation tax, medallion renewal, accessibility fund $14,000 per $6,000 per year $1,940 per year year

Data analysis by James Bradach, Nonprofit Data and Applications, https://jamesbradach.com

Were calling on City Council to pass comprehensive reform to assist

struggling taxi operators and preserve a taxi system in Chicago:

Amend the Medallion owner code to eliminate vehicle age/change of equipment requirements (aslong as vehicle passes city inspection, same policy that applies to TNPs)Create a waiver of ground transportation tax for struggling owner/driversEliminate medallion license renewal fee (same as TNPs, which have no per-vehicle license fee)

Were calling on the Department of Business Affairs and Consumer

Eliminate regulatory barriers to a driver-to-passenger taxi ehail app

Enact protections for lease drivers in the event of fleet bankruptcyReinstate the lottery for city-owned medallions to reduce operating costs for lease driversStrengthen foreclosure protections in the City Medallion Owner Rules

Were educating distressed taxi

operators about the law that applies totheir medallion loans and referring themto affordable, independent legal service providers who can help drivers individually negotiate with lenders and restructure their debt.The data used in this report comes from the City of Chicago's data portal: https://data.cityofchicago.org/Transportation/Taxi-Trips/wrvz-psew